MAINLAND investors used a new trading link to buy a record amount of Hong Kong shares last week, as worries grow that a rally in Shanghai may be running out of steam.

    Purchases of shares by mainland investors resulted in an inflow of about US$811 million to Hong Kong’s stock market from the mainland, easily beating the US$514.6 million that came in during the first week of the Shanghai-Hong Kong stock connect. Still, even on its most active day last week, only 16 percent of the quota for buying into Hong Kong was taken up, indicating the program is still struggling to gain traction.

    Since the trading link kicked off in mid-November, mainland investors have been fixated on their own markets, causing the Shanghai Composite Index to rise 52.9 percent in 2014. That has left the market looking expensive compared with Hong Kong, and recent volatility in the Shanghai market may be scaring some investors away.

    “It’s another way to diversify,” said Zhao Guanglin, a 40-year-old accountant in Shanghai, who said he wants to invest in blue chips, which are cheaper in Hong Kong.

    He said he has about 500,000 yuan (US$80,457) already invested in Shanghai-listed blue chips, but wants to switch some cash into Hong Kong using the new program.

    Many of the stocks most popular in Hong Kong with mainland buyers have been those that can’t be bought on the mainland. Internet giant Tencent Holdings has gained 13.1 percent in the past week, while China Mobile is up 4.4 percent. (SD-Agencies)